For Immediate Release
Chicago, IL – May 17, 2012 – Zacks Equity Research highlights Macy's, Inc. ((M - Analyst Report) ) as the Bull of the Day and AGL Resources, Inc. () as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Jones Lang LaSalle Incorporated ((JLL - Analyst Report) ), Procter & Gamble Co. ((PG - Analyst Report) ) and Safeway Inc. ().
Full analysis of all these stocks is available at https://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
Bull of the Day:
Macy's, Inc. ((M - Analyst Report) ) has been taking prudent steps to increase sales, profitability and cash flows. These include integration of operations, consolidation of divisions and customer-centric localization initiatives. To help drive traffic, Macy's continues to focus on price optimization, inventory management and merchandise planning. These help the company to deliver better-than-expected first-quarter 2012 results.
The quarterly earnings of $0.43 per share beat the Zacks Consensus Estimate of $0.40, and rose 43.3% from the prior-year quarter. Macy's continues to expect fiscal 2012 earnings between $3.25 and $3.30 per share.
The company hinted that it is seeking to expand both the Macy's and Bloomingdale's brands, which present enormous opportunities to enhance market share. Macy's, which saw a 1.2% increase in April comparable-store sales, now expects comps growth of approximately 3.7% for fiscal 2012.
Bear of the Day:
We are maintaining our Underperform recommendation on AGL Resources, Inc. () with a target price of $35. We expect shareholder sentiment toward the company to remain lukewarm, considering its investment in higher-risk unregulated operations, ongoing regulatory uncertainties and the challenging economic environment.
AGL's earnings are likely to suffer in 2012 due to a less-than-favorable outlook at its wholesale segment. Additionally, the inclusion of the shipping operations (post Nicor acquisition) has left AGL with a weak business, thereby heightening its risk profile. Partially offsetting these negatives are the company's large and stable customer profile, consistent dividend growth and strong liquidity position.
Considering these factors, we see little reason for investors to own the stock and therefore maintain our Underperform recommendation. Our $35 price objective reflects a 2012 P/E multiple of 12.7x.
Latest Posts on the Zacks Analyst Blog:
Jones Lang Extends P&G Alliance
Jones Lang LaSalle Incorporated ((JLL - Analyst Report) ), a leading real estate investment trust (REIT), has recently extended its global strategic alliance with Procter & Gamble Co. ((PG - Analyst Report) ), one of the largest consumer goods companies in the world, by forging a new five-year agreement as its global commercial facilities service partner.
With the deal, Jones Lang has further cemented its strategic ties and reinforced the business relationship with Procter & Gamble that had originated in 2003, when the two companies joined together to pioneer service delivery approaches and technology-supported platforms to excel competitive pressure.
Under the terms of the new agreement, Jones Lang would provide integrated facility management, project development, construction management and strategic occupancy planning services for all the owned and lobal leased corporate facilities portfolio of Procter & Gamble, spanning over 60 countries across 6 continents including North America, South America, Europe, Africa, Asia and Australia.
Several positives weighed in favor of Jones Lang in outsmarting competitors in the race to be adjudged the best in its business by Procter & Gamble, including its unrivalled track record of superior service delivery, flexible global service model and dedication to using facilities and real estate investments as a competitive advantage for the consumer goods company.
Safeway Boosts Dividend
Major grocery chain Safeway Inc. () recently announced a 21% increase in its regular quarterly dividend to 17.5 cents per share from earlier quarterly rate of 14.5 cents. The dividend will be payable on July 12 to shareholders of record as of June 21, 2012.
Safeway has an effective capital deployment policy in place and strives to benefit shareholders through dividend payments and share repurchases. During the first quarter, the company repurchased 46 million shares for $1 billion. It additionally increased its share repurchase authorization by $1.0 billion to $1.1 billion.
Despite the prevailing volatile macro environment, Safeway possesses high earnings visibility, consistent cash generation ability and disciplined investment. At the end of the first quarter of 2012, Safeway had $134.5 million in cash and cash equivalents compared with $729.4 million at the end of 2011.
The company’s free cash flow in the first quarter declined to negative $224 million from positive free cash flow of $112 million due to higher capital expenditure of $308 million ($185 million in the year-ago quarter). In 2012, Safeway expects around $900 million in capital expenditures with free cash flow in the range of $850–$950 million.
Get the full analysis of all these stocks by going to https://at.zacks.com/?id=2649.
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About the Analyst Blog
Updated throughout every trading day, the Analyst Blog provides analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today by visiting https://at.zacks.com/?id=7158.
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment
Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at https://at.zacks.com/?id=4582.
Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Zacks Investment Research
800-767-3771 ext. 9339